tv Charlie Rose WHUT July 20, 2011 9:00am-10:00am EDT
>> charlie: welcome to our program. we begin this evening way look at the testimony by rupert murdock, james murdock with an assessment from john burns, ian katz and josh tyrangiel. >> he tried to be contrite and as this sort of afternoon wore on you saw the emergence of the 20th century media mogul who got more gruff but may felt more honest. >> charlie: whe he continue with a look at the deb limitations talk and the new proposal by the gang of six and conversation with senator ron portman of ohio. >> we need to get the standing
down. historic vels are about 20-20.5% of our economy and i'm optimistic because i feel we have to address the issue. >> crlie: the murdock story in don and the debt limitations talks in washington when we continue. funding was provided by the following: every story needs a hero we can all root for. who beats the odds and comes out on top. but this isn't just a hollywood storyline. it's happening every day, all across america. every time a storefront opens. or t midnight oil is burned. or when someone chases a dream, not just a dollar. they are sll buness owners. so if you wanna root for a re hero,
support small business. shop small captioning sponsored by rose communications from our studios in new york city, this is charlie rose. >> charlie: the controversy that's rocked rupert murdoch's business apierced before members of british parliament. the session last lead it hours and apologized but insisted they knew little or nothing about the illlegal phone hacking at the newspaper, news of the world.
>> first of all i'd like to say as well how sorry i am and how sorry we are to particularly the victims of the illlegal voice mailing deceptions and their families. it's a matter of great regret of mine,y father and everyone at news corporation and these are standards these actionso nolive up to the standards that our company aspires to everywhere around the world. >> i would like to say this is the most humble day of my life. >> thank you. >> i became aware as it came out. th i was absolutely shocked, appalled and ashamed when i heard about the case only two weeks ago. >> charlie: here the end of the testimony rupert murdoch was asked if he considered
resigning. >> have you considered resigning. >> no. >> why not? >> because i feel that people i trusted, not saying who. i don't know what level, they let me down and i think they behaved disgracefully and betrayed the company and me and for them to pay. i think frankly i'm the best person to clean this up. >> charlie: adding to the drama someone in the room disrupted the session by trying to throw a plate of shaving cream at rupert murdoch. following the murdoch's rebecca brook who's resign head of operations last friday and arrest and questions by police on sunday. brooks, a former editor of news of the world denied prior knowledge of the phone alletions but apologized to the victims.
>> it was cruel and i have regrets. just the idea that phone access was by someone of the news of the world is abhorrent to me as it is to everyone in this room and it's ultimate regret the speed in which we have found out and tried to find out the bottom of the investigations have been too slow. i think james a rupert both accepted that earlier and we're endeavoring to continue to contuein to investigate. but of course there are regrets. don't know anyone in their right mind who would authorized no sanction approval for anyone listening to the voice mails of those circumstances. i don't know anyon who would think it was the right and proper thing to do at this time or at any time.
>> charlie: also appearing s sir paul hnson the head of scotland yard who resigned sunday. the hearings comes after ten arrests and a series of resignatns as fallout from the phone hacking scandal grows. with me john burns, ian katz, deputy he had tortd of the guardian and david karr of the new york city times and sh tyrangiel edito of newsweek. ian katz, what does this day whh rupert murdochcalled the humblest day of his life. what does it change and where do we go from here? >> well, it's not a day we learn an awful lot of significant things. if anything the clearest lesson is wendy dang has a formidable right hook but it was a day of quite striking theatre i think. for in who sits in this country the idea of rupert murdoch who
two weeks ago was the most powerful person.country being hauled into parliament to answer questions is prett pretty extraordinary and we had the dialog of him saying it was the humblest day of his lif that w pretty striking. the interesting thing is he and james murdoch came in saying sorry and contrition if you lied but the message was we're sorry but it wasn't else, was someone else's fault and that's the bit that will get tested over the next few weeks and months. >> charlie: they said it was people th are had trusted. >> it was other people. anyone but the people sitting there. we had an extraordinary day because though the focus was on the murdoch hearings we had hearings with senior policeman and the former director of
public prosecutions andjust about everyone who came before a committee today had a buck to pass to someone else. the secular firing squad strategy is what it's being called. >> charlie: john burns, how did you see it? >> ihink if i was a public relations advisor of the eddelman's i think i would would be wl pleased given they have a rather case to advance they probably did as well as could possiblye expected. of course, nobody could have scripted that moment when wendy leapt to her left like as one of your other guesseswere saying like a basketball player and went for mr. johnny marbles with his paper plate and shaving foam. what that did was to present rupert murdoch who had never
been in such a mode before as vulnerable as an 80-year-old man d in a state of abject apology all afternoon and no doubt scpt and heavily lawyered admitting to nothingnd then all of a sudden in this thing happens and i think it was bound to make the vulnerability as appealing or at least look a little less like what in this country has been known for many years th's dirty digger. >> charlie: so josh, you're asking the same question tonight you were asking before the day began? >> yeah, i think to ian's point we didn't find out a whole lot. what made it an event for us in the media to concede was unmediated you can prepare the protagonists for the stage but when they're up there they're on their own. what i found fascinating is rupert murdoch spent a lot of his first testimony not being
rupert murdoch and being contrite and as the afternoon wore on what you saw was the emergence of very much the 20th century media mogul got more gruff but maybe felt more honest. at one pointthe questioner said rupert murdoch i'm going turn to you since i don't seem to get far with james murdoch and he got more gruff. he steamed to respond in a differt way. james was every bit the picture of a 20th centu corporate polished ceo saying no matter the merit of the question that's a tremendous and terrific question and i appreciate the manner in which it's been asked and his preambles were enormous and the content of the answers were minimal and existing always flattering the questioner. what i liked was the contrast. murdoch was as he said, humbled and i think he was contrite.
the measure of the contrition seed to go down toughout the day until we got the pie as some over the internet said that saved news corp. not sure that's right but it was astonishing. >> charlie: and james murdoch to be protective of his father. >> there was also a moment when rupert murdoch stopped his testimony and said my son is telling me to stop gesticulating. >> i think he's fairly a good display of a limits of a family and the ize which is wh news corps is. we tend to look at it as a large spectral media company brought low before parliament, father and son. and i think they did a good job
of saying that. there was a lot of roll up and roll out. i do think thhere wer tim when jam seemed o of his depth and rupert seemed plain out of it especially at the start of the hearing. the hearing problems and mumbling problem and as john pointed out this is an 80-year-old man and ian was in the room but on television when the pie thing hap ended you can almost see the room tilt toward him because it's a reminder that look, all these guys pointing the crooked finger at you, rupert murdoch can't even keep you safe. that guy could have had something in the f flecklsness.
>> as wendy launched her up you are cut and you see constable from scotland yard not run or cantor he stumbles and i thought this must surely be hollywood working on this because we've beenearing all afternoon throh the evasions of the scottland yard offices who resigned over this affair the top man, the commissioner and his deputy in effect and they were a must say for a brit as i am was with brought with him an idil of the country as i experienced it growing up in the 40s and 50s came back to find there are many wonderful things
about this cntry and many other things that are not at all as they were and now we find scottland yard is incompetent as well as corrupt i'm afraid to say and there we were with constabl constabl constabl constable pluad on the scene and mr. murdoch had shaving cream over his jacket. >> charlie: how about rebecca brooks, ian. >> after the extraordinary murdoch's sce and particularly the pie moment it was a bit of an anticlimax, rebecca brooks. she got off extraordinary lightly this wasn't the forensic grilling you may get in a senate committee. it was fairly sloppy quite a lot
of time. she looked pretty awful i thought and it was put in a pretty controlled performance i think almost sort of playing for the sympathy vote a bit but just like james murdoc murdoch, the of her position was i didn't know about this and the mps simply didn't have the resources or information to cross-examine her lightly enough to unpick her story and she also was able to say look i've bee arrest and being investigated i can't answer difficult questions. >> she had a side door is that was not available to the murdoches because of this arrest which none us expected she went in forrg she could go out the side door of saying she was subject to arrest and the band width of what she could say wa
narrow. >> charlie: would have been better had they not arrested her? >> by a million miles. >> those of us that are fans of senate questions is when you're under oath your under lines and i mount most of the questions was what did you know, how come you didn't know it. >> and the tom watson the labor mp. they were there but i thought he was fairly strategic in terms of boxing them in. >> watson did the best job of pushing and pushing but where to the murdoch's credit they ntinued to hue in the line that yes we run the media company. this is small, we didn't know about it and just as outraged we didn't know about it and you can box them in butunless your strategic about the rest the questioning and that's where i found it disappointing there are specific instance instances now.
>> there were a couple of desparately frustrating -- i was in the office not in the room watching this sadly but there were moments when you were raging at the screenaying fo god sake ask the question about the goon taylor payment properly and there were few tough follow-up questions just likehe passage with rebecca brooks when she was asked about her relationship with the prime minister which is a rich subject where she should have been asked quite forensicly how many times she'd seen him as prime minister and four last week and they've incrsed it to five. it's almost certaiy man many more times and politically it may end up being one of the most toxic aspects of the crisis because over time he'll have to explain why the hired andy
carson and kept him in the face of all the warnings but hugger-mugger with the other woman, rebecca brooks when she now appears to be one of the most maligned characters in the media. >> you mean a great family friend having dinner and riding rse back and thatsort of thing. >> yes, she made a big point in the hearings this afternoon saying she hadn'tbeen to downing street while david cameron was prime minister and contrasted it with the fac she'd been there a l under gordon brown and tony blair and the reason she hasn't been to downing street is she doesn't have to. they see each other ithe country side in the little village and easier to meethere an gng to downing street and have it in the papers.
>> the solution to bad journalism has been more journalism and government has been far and ay bystanders and i don't think the committee hearing did a lot to change that. i think the lines of inquiry will continue to advance will come from the guardian and new york times and will come from the wall street journal and probably not from the mps of parliament. >> charlie: but including the wall street journal. >> wall street journal i thought was hilarious the other day saying there's an editorial saying you're all doing overkill there's so much and all hard-hitting. you have a $40 billion company to close a 168-year-old newspaper and ten people arrested, a pie in the face, now a dead dy, it doesn't get much better than this when it comes
to news. >> crlie: john, the prime minister will come to parliame t parliament. what's going to be his argument. >> charlie: he'll be back tonight and hel have a trip to southafrica. of course the central question in all of this is for cameron is his judgment. the are many in his own party as well of course in the labor partand in e liberal democrats as partners in the coalition wh are absolutely dismayed at his employment of course and his driving through every red light and a part from the specifics of this case and how much he knew or should have known about all the forensics that we're beginning to hear about the judgment question is a serious one because in effect with his policies is severe
austerity and asked the nation to embark on a risky voyage with him. and if people begin to think he's naive and callow h before becoming a full-time politician a common story here and he'll have a rough time in the us house of commons and the liberals are so happy and discontent and honest with the conservativeand economic indicators are notooking good. there's trouble ahead. there are service unions threatening more season of strikes. >> i think the most interesting word john used was "mission." cameron is asking the country to
go on a mission and it requires belief because no one knows what's on the other side and it requires belief in the policy and politicians. the country has been thrgh three now reerj amazing cataclysms in the public space. have you bank failures, financial crisis and expense account fraud throughout the government and now this and cameron i think has positioned himself smartly as someone who is going to bring the united kingdom through on the msion but if his credibility is in question and people do not believe in him it's an enormous political probleand one difficult to pin down. what you see on the oppositi side and the colleagues in the u.k. can speak t this is they're hammering in a belief in cameron and translates to a belief in licy and if you can't believe in one you can't believe in the other and it's a danger for what comes out in debates and it's different than fo or five ds ago. there's been effective
opposition on tha point. >> charlie: is there explanation why david cameron insisted on hiring coleson even when he was warned by people know, ian. >> there's a conspiracy theory. it has it that rebecca brooks advised himto take andy coleson so he would have an alliance in the nation and they would look on him kindly and david cameron was settled on now the press secretary for the london may and at the last moment rebecca brooks persuaded him to take coleson instead and i'm a bit skeptical. >> she denied it today. >> she denies it and tartly suggested it was george osborne the chancellor who suggested coleson which i think is true. i suppose if you're skeptical
you'd say he wanted alliance national and wanted to bring the papers over to the toriis which did happen. knowing some of people involved a bit he was good at what he did and was pretty effective. he knew how to operate in the media. he was a crisp communicator. they liked him in downing street. i think david cameron liked him a lot. i think david cameron felt he was terribly useful to him on stories that were -- could have been threatening personally and good at batting way difficult stories and i think there's a curious mixture of arrogance and weakness about david cameron. the arrogance was he thought he could brush these things away and all these annoying little pests like the guardian could bang on and on about coleson and he would bat them ay with his nguid atonion charm but it's
coupled with a weakness that meant he couldn't face the conflict. face coleson sitting down and giving him the third degree whether he'd been involved in hack and i think that's how he ended up in the mess. i agree with john that this is ing to be something that simmers on. i don't think there will be a killer blow tomorrow. he'll take a dusting tomorrow but over the next few weeks, months, years even the story is on track to rumble through the courts through two ore more judicial inquiries and every time we see a picture of someone going to court or jail the judgment questions are going to come up again. er time i think it will extremely damagi to david cameron. >> charlie: one of the questions today was this is a real test for james murdoch. did he pass that test?
>> he didn'tay anything particularly incriminating. >> charlie: he looked in control? >> he looked like he was coached well and took the coaching. again his response -- >> charlie: he had a teachable moment? >> his responses were familiar to us to anyone who have seen people lawyered up and keeping their cool. he camoff as human. most people who are watching the proceedings were surprised he really is american. i don't think he demonstrated any sort of leadership or any -- i don't think there was a real genuine moment that broke through that would give one a new perspective on him i think he was very careful. >> i think his big accomplishmentas that he' a good son and tried to jump in front of hard questions and over his father the protectiveness of
the murdoch clan with wdy batting away and james again and again trying to get tom watson was on his ankle just chewing awide and saying if i uldn't, mr. watson said , he ran the company i want to talk to him. i do think that there was a suggestion in bloomberg rerted thaterhaps news corporation was switching. i never bought that. >> charlie: i didn't either. i didn't believe it whether the story is true or not. >> if i may defend my colleagues i can say it's a well-sourced story and the story in response was not a denial. both responses could very well be true. >> but it was framed the board is sitting to see how he's going to do at the hearings today. we all knew he wouldn'to great. it wasn't like he was battling for his job today. james may have been but certainly rupert was not. >> i'm not sure i agree with that.
i think that what ever good bod prepares for the worse and if there had been some sort of conflagration or lost his temper or seemed out of it it would have been irresponsible of the board not to talk about that. >> with no specialist knowledge here but my strg hunch is that we were seeing today probably the end of the rupert murdoch dominated news corp era. yes, i run the company but maybe the country too but i know nothing about what's going on in it. at time and time again said i didn't know rebecca bros came before the commite and said she was paying police officers. i didn't know about the gdon taylor settlement. he didt know anytng. as a shareholder --
>> he said i'm the man to clean it up. >> but for large chunks of the hearing it reminded me of a conversation with an old relative trans-atlantic phone line long delays by slightly in coherent answers or answers of a slim gr on the facts and i thought that was not a performance -- you're right, someone mentioned earlier the performance got better as the day went on but i thought that was if i'm a shareholder i would have thought this man should be running a company. >> i'm not sure i agree. it's te the word doggery was heard amongst the press as the first minutes of the hearing passed by but it seemed to me as time went on they were following
a carefully plotted strategy. james murdoch, although he did a good job of rrer denying his responsibility he was in line to run the operations overseas rupert by strategy was to stick to his apology mode which he's been in now four or five days starting with his meeting with the dowell family and holding his head in his hands and taking full page space in every british newspaper both saturday and sunday with his ad saying "i am sorry." i think the tactic was to ay above the fray and in apologetic mode and later on after the pie incident seemed to energize him where he moved t sge two where he said very clearly in the closing minutes, look, i'm
in charge of this corporation, i'm the one that can lead the corporation back to redemption and my feeling is during the break after the pie was thrown at him the lawyer m have said, look, you've done phase one very well. you haven't gotten involved in the forensics, you stay above the fray and now it may be time to pay attention to the board members across the atlanc and make it clear you in continued t -- intend to stay ain charge. >> and james pying the role of someone answerg questions with a possible legal ramifications wait for a question to come up and willful blindness is a term that came from the enron case and before the question ended rupert murdoch said i'm familiar with the term. nothing like that ha happened h
and you can see him stirring. that's why i feel he got better as he got closer to being who h was and james provided the coverage of that. >> and got around the issue of look there are a lot of ben fits to the competitive cross and you're not acknowledged that we're part of a transparent free and open society we provide a lot of information and went on a counter-offensive that's hearing went on and more or less came to defe newspapers in general as an important part of the common. >> and let it be sd roger cohen one of the coluists in the new york times rather bravely last week went to bat for rupert murdoch on the good he has done and not to excuse for one minute the perfectly ghastly things the news of the world a possibly some of the tabloid stalstalemates has done
is untry'semocracy may have been remarkably poorer in the last 40 years if not for the murdh influence and the not in least keeping the times of london which is losing heavily some say 50 million a year and the sunday timeshich has for many years had the strongest investigative team of any western newspaper. these are things for which rupert murdoch has to be credited and he at one point felt confident enough today to step forward and say so. >> charlie: thank you, pleasure to have you here. today the bipartisa gup of senators known that's gang of six unveiled their bucket plan to cut the deficit by $3.7 trillionver the next ten years and calls for immediate spending
cuts and includes entitlement reforms and $is trillion in tax increases. president obama spoke from the white house as praising the bill as a balanced approach. >> the group of senators, the gang of six, democrats and republicans now a gang of seve because of one additional republican senator added on put forward a proposal broadly consistent with the approach that i've urged. we have to be serious about reducing discretionary spending and defense and serious about tackling health care spending and entitlements in a serious way and ref where there's shared asacrifice and everybody is giving up something. >> charlie: the president urged congressional leaders to move swiftly and end the stalemate.
>> charlie: my hope and what i'll be urging speaker boehner and nancy pelosi a reed and mcconnel is they tomorrow are prepared to start talking turkey and actually getting down to the hard business of craftina plan that can move this forward. it's important in the next couple days to understand we don't have any more time to engage in symbolic gestures. we don't have more time to posture. it's time to get down the business of solving the problem. >> charlie: the president's remarks came before house republicans voted on of the house plan and joining menow from washington is senator ron portman from iowa. a member of the senate budget committee. pleased to have him back on the program. welcome. >> charlie, pleased to be back again. >> charlie: this is what they
said he's proved a top asset to gop neg shal negotiator and con to the work behind the scenes and a feather in the cap to who could be a strong 2012 contender. and you have played a role here. so tell mehat you think of the gang of six proposal that the president acknowledged today and that a number of senators came forward to say this is a very very positive involvement. >> it was a positive development on a few different fronts. one is it's bipartisan which is rare these days and had democrats and republicans coming together fr of whom had served own a board the president established and they came up with changes in ter of the
spending going forward. they were fairly significant and that's short-term t longer term and looked at the entitlement side and didn't look at much as to what many have done and thi they showed that even in the short term there are thgs that can be done and should be done and could help with regard to the debt limit discussion. i think it's timely. i'm glad they came forward with their proposal and well received for many of us who stopped by this morning for a briefing. >> charlie: so it going to be the first stem toward a bipartisan agreement? >> i don't think anyone of them would say it was designed to deal with the debt ceiling issue. it was again a product of the fiscal commission. four of the six had been on the fiscal commission and it's not intended to solve that problem but could help in regard to the probm because it lays out again through a bipartisan
effort ways to reduce spending both short term and longer term. i do think that in terms of the debt limit discussion there would need to be more up front following the formula that speaker boehner has ld out over ten years there needs to be adequate cuts and equal cuts to e amount of increase in the debt limits andinitial reduction is $5 billion which is a lot in the tow but if you look at how far it would extend the debt limit it would probably be less than year-end. therneeds to be more done short term. this cannot be, in my view, a substitute for whateeds to be done to extend the debt limit. >> charlie: but it's more likely now we're seeing with this gang of six recommendations met with such approval more like the direction the conversation is now rather than mcconnel-reed.
>> i think it is. that's probably a positive. again, it's some real spending reductions up front and a longer term commitment on things like tax refo which is an important part of this because part of this is getting the economy moving again and on the specific spending reductions. i think it's a positi sign. my only point, charlie, i'm not sure it's enough for the short termecause i think the markets are watching carefully which you read what standard and poors and moody and rich and not just that we need to avoid a default which we certainly do and extend the debt lim and fix the underlng problem and congress needs to provideore short-term spending restraint in order to extendhe debt limit to next
year which would be consistent with not jus the gang ofix plan today because it has again six months for the committees to do their work and the idea that senator mcconnel and reid are setting up a select committee over six months to look at the longer terms problems. >> charlie: does it go far enough on the kinds of issues republicans have focussed on, entitlement in >> no it doesn't and i think they would acknowledge that but it's a start and prior to this time there was a hesitancy to even touch the programs and now there's an acknowledgement they're unsustainable in their current form as important that's programs are theare simply not sustainable. it's a start down the path and also an acknowledgement on the revenue side thereneeds to be tax reform in order to begin the process of growing the economy. it's not just abo findingore revenue it's about finding more
revenue through economic growth which widely acknowledged and need to do a number of things to fix the deep fiscal hole we find ourselves in. >> charlie: do you agreewith the president's argument we need to look at corporate deductions in a variety of places to have some sort of contribution on the revenue side? >> well i agree with the president there are too many credits and deductions and exclusions in the code. the ones he's pulled out are examples of ones that cobe eliminated with lowering the corporate rate which is the highest in the develod world among our trading partners america has a relatively high rate meaning companies are going overseas because companies are going to lower-tax company and parking cash overseas because of high corporate rate. this is part of the tax reform
the commission recommended. this is the president's fiscal commission the gang of six has recommended and consistent with the president's talking about so long that's rate is also reduced commensurate with the reductions of the preferences. that will help in getting the economy moving and there's a lot of analysises outhere but it will result in more economic activity. >> charlie: hasn't the president signaled he's prepared to a reduction in the income taxas ng as there's closing of the loholes. >> he has in the past and the treasury department did a lot of work andeverame out with a propos andever came out in the budget. i'm confused why because it's a classic example where they came together and the gang of six calls for the lowering of the
rate to be revenue neutral but will be helpful in growing the economy and help in employment and revenue because these reforms are just so sensible to make the code more efficient and attract more jobs and investment to the united states. >> charlie: what you do you say to your colleagues on your side of the aisle that raising taxes by august 2nd have the impact the president and ben bernanke say. >> it's something we have to avoid in terms of financial markets and economy i think wel see negative impacts in the next few weeks if we don't take action tire to august 2. second, with regard to the ben fits that are paid by the government during the period
after august there is risk. the government will be on a cash-flow basis without having the aabilit theability to barrow will be put in a tough position and tough on the spending side similar to 1995 when there was a government shutdown and republicans wound out because of political pressure had a spending issue. we need to reduce the spending if we don't again it is something the credit agencies and investors around the world are looking at. we need to get r fiscal house in order. it's necessarily but not sufficient to extend the debt limit. we have to also deal with the spending and my fear is if we go into the post-august 2 period it makes it harder to deal with the spenng because there will be pressure to extend.
>> charlie: what's the amount of cuts you'd like to see and where the president is prepad to accept. >> i'm not in the negotiations and hesitate but as a general matter there's a disagreement one is what the spending ought to be next yeared on the discretionary spending the stuff congress appropriates every year and the notion can freeze the spending suspending it over 24% over the past four years and need to see a reduction. this was the debate over the continued resolution and that's one area where we need to see an actual reduction in spending not just a freeze in the spending congress appropriates every year and second is in the area of entitlements.
the president has been hesitant to accept entitlement changes. by increasing the taxation of the burden of the economy we fear we'll worsen the economy. the president doesn't want to touch it and has to be touched and the gang of six does it ia necessary way to deal with the unsustainable grow on medicare and >> charlie: he praised the approach of thgang of six today. >> i think his response was encouraging but still haven't seen aproposal one thing we talked about before is you need to see specifics from the executive and the leadership and the budget the president sent forward which was his ten-year vision voted down 97-0 because it not only didn't deal with the spending problems it made it
worse. the president ao has not submittea specific proposal in dealing with the entitlement challenge we face. i'm encouraged by his words today but we need to se action and leadership and willingness on the part of the president to help in terms of taking the lead. again, we have a fundamental disagreement many of us with the president over the revenue side but shouldn't preclude us from working with tax preform and geing rid of the r reductions he's talking about and spending and we can do that now for the short term dealing with it over the next year to move the debt limit forward and in the meantime come up with more fundamental changes on a bipartisan change that's gang of six has recommend. it seems like a logical solution to the current problem. we do not want to extend beyond the debt limiteriod or default and want spendin spending limitn
place or we'll have a real that of a financial crisis. >> charlie: what do you think cantor would think of eang of six. >> one of the issues the gang of six is dealing with it's been a senate centric process and the house has not been involved. there is i think an opportunity for all of us to come together in the next few days and take a hard look at it and see what can being worked into the debt limit discussion. i've attended a few of the briefings but the house members have not had the opportunity. >> charlie: tell me what your optomism tells u and your pessimism tells you at this moment. >> have you to be optimis optim because the altnative is unthinkable that we'd fall into the post-limit period and default on obligation and this would be financial market
response and if intest rates were to go up by a point or two it would affect everybody that's got a car loan or student lone or mortgage. it's obviously going to hurt smallbusinesses trying to create jobs and need to get credit. you have to be optimistic we're going avoid that and that common sense willreva that it's not just about extending it but aling with the unrlying problem and if tt doesn't hap end have you some of the same problems because again there's such a huge imbalance between ref and expenditures. the fact is that we have to get the spending down. historic levels are 20 or 20.5% and we're about 25% of our
economy. i'm optimistic because i feel we have to agre address the issue the pessimism comes from the numbers long term and i'm going to do something i did on your last show last time and probably didn't invite me back because of it and here's the chart and here's the congressional budget office and their projection of what the debt will do if we do not deal with these issues and it'sunthinkable we'd have these levels of debt because the economy would be destroyed through this kind of huge burden of debt and look at greece today and it would pale in mparison this and we can't let this hap end but my peimism has to be the problem is bigger probably thaanyone in the political world is really acknowledging. theiabilities are huge and growing and if we don't deal with name we're going not to just take away the opportunity
for our kids and grand kids to have the opportuties we've become accustomed to and the global economy will be also hurt badly. america continues to be the biggest economy in the world. we shod be driving this global economy and be the beacon of hope and opportunity. that's the pessimistic side. the problem is truly big. >> charlie: we have begun to have in country in washington and around a much more serious look at where we are in terms of our economic health and that's a recognition is the beginning of some kind of recovery. >> i think you're right, charlie. we're on the slow process. you start by acknowledging the problem right. hopefully we're getting out of denial and acknowledging it. i wonder sometimes andthat's the first step bu then we have to do something about it and we're under the n. we don't get our act together an extend and deal with the
problem i feel the consequence will be negative. here's one example of wha can hap en en if we don't deal with the problem every point is more in deficit spend something 1.$3 trillion over three years and if it gets closer to the historic average that's another $260 trillion a year but .6 trillion a year is how serious this is. we have to deal with the unrlying problem and have to be sure we're growing the economy and not just focussing with our green eye shades on on spending issues and how to get more growth and economic activity and more revenue in a way that helps americans in their daily lives. those are our challenges. >> charlie: president of the
world bank, robert zellich had a sharp criticism of u.s. trade policy. did you agree with it, did resonate with you? >> i didn't hear it but i did meet with him as a trade representative -- >> charlie: that's why i'm asking. >> his criticism is we're not engaged. the united states is taking a back seat and it's unfortunate because there arever100 trade negotiations being traded around the toward and the united states is not a party to any of them. there's one regional negotiation we're part of b ankly it won't be the kind of success we have to have to open markets for our farmers and service providers and taking a pass and losing mart share every day. trade needs to be fair and need to be sure we're enforcing the trade la but need to expand our experts.
we rank below ethpia i'm told in terms of our exports per capita. well below any of the other developed countries werade with and well below china and korea and countries we hope to trade with more in the case of korea through the korean trade agreement. so one, we need to pass the three agreements the president has already indicated he supports and send them to congress right way because they're good for us and good for amican workers and farmers and second we need to reengage in the world stage to make sure america has a place on the table as new market share is being opened up we have the opportunity to allow our workers to take advantage of that. i am concerned about the direction of the trade policy and i'm hoping we can address that in the context of passing the agree agreements and at the same time give the president of another party than i am the trade promotion authorit to enable him to complete the
agreements because they're good for our economy. if you look at what's ha hpened in the disappointing growth in the last couple quarters without the trade it would have been far worse. trade one of the areas we've seen befit because w have increased exports because of the value of the dollar going down but this is an area where we should be doing a lot more and being a biggertrading company and should be the largest exporter in the world which we are in many categories but per capita well behind all of our trading partners. we should be way ahead. >> charlie: i thank you for joininus this evening. >> thanks, charlie. >> charlie: don't stay away so long. senator ron portman. republican from ohio. captioning sponsored by rose communications